Avaya has announced that Donald K. Peterson will be stepping down as President and CEO. Peterson will remain Avaya’s chairman of the board of directors through September 30, 2006.

Avaya further announced the appointment of Louis J. D'Ambrosio to the office of`President and Chief Executive Officer. D'Ambrosio has held a series of key leadership roles at Avaya, most recently as Senior Vice President and President, Global Sales and Marketing. The Board also appointed Michael Thurk, Avaya’s Senior Vice President and President, Global Communications Solutions, as Chief Operating Officer.

The personnel moves come in the wake of disappointing earnings for Avaya. Net income for the fiscal third quarter fell to $44 million, or 10 cents per share, from $194 million, or 40 cents, a year earlier. Investors responded by selling. Shares dropped from 10.54 to 9.89 in after-hours trading.